Billionaire businessman and philanthropist Bill Gates said he isn't surprised by the sluggish economic recovery, adding that tax increases are needed to balance the federal budget.
"The budget is very, very out of balance," Gates said on"Good Morning America" today. "Without changes in taxes or entitlement policies, it won't get back into balance. Taxes are going to have to go up and entitlements are going to have to be moderated."
Gates also showed support for the president's plan to tax the country's largest banks to recover losses from the Troubled Asset Relief Program, despite his friend and Berkshire Hathaway CEO Warren Buffett's opposition to the plan.
"That's a rare case," he said. "Ninety-nine percent of the time I'll agree with Warren. He's a great guide for me. I think we see it differently."
Gates, who focuses much of his efforts on the Bill and Melinda Gates Foundation's work to support advances in world health and education, said he hopes those necessary cuts "won't cut back a few key areas, like aid to poor countries."
Despite the slow recovery, Gates, 54, said he supports President Obama's economic policies so far.
"He inherited a very tough situation," Gates said. "The financial markets were stabilized ... now we're having a slow recovery. Everybody's frustrated by the pace of the recovery. When you have a financial crisis like that, it's years of digging out."
In his annual letter, which Gates first wrote last year and plans to do yearly to provide an update on his foundation's work, he stressed the importance of education and scientific innovation, particularly during a time of global economic challenges.
"If we project what the world will be like 10 years from now, without innovation in health, education, energy or food, the picture is quite bleak," he wrote in the letter. "Health costs for the rich will escalate, forcing tough trade-offs and keeping the poor stuck in the bad situation they are in today."
Gates, the chairman and co-founder of software company Microsoft, encourages innovators and world leaders to work together to address issues ranging from disease to agricultural challenges.
"If we don't get innovation, the health situation of the poor will continue to be bleak," Gates said today.
The foundation is particularly focused on children's health, and vaccines are a major part of that initiative. It invests more than $800 million annually on vaccines, and Gates cites vaccine combinations such as the single immunization for diphtheria, tetanus and pertussis as one of the foundation's achievements. The DPT vaccine is now available for less than 50 cents.
"Only by having new medicines ... will we make progress there," Gates said.
The foundation is also focused on the complete eradication of polio worldwide. Despite significant progress when it comes to malaria, Gates said he believes it will take between five and 15 years to develop a fully effective vaccine.
Gates also said in his letter that innovation is essential to curb the spread of HIV and reports that the HIV vaccine trial is a sign of progress on that front.
CLICK HERE for a slideshow from the Gates Foundation showing a vaccine's winding path through Nicaragua.